IEEFA Appreciates PLN's Concrete Steps In Forming Energy Transitions In Indonesia

JAKARTA - The Institute for Energy Economics and Financial Analysis (IEEFA) appreciates PLN's steps to continue working to encourage the energy transition in Indonesia this year.

Energy Finance Analyst IEEFA Elrika Hamdi said that 80 percent used to finance power plants entering Indonesia for coal plants. However, currently, countries such as Japan, China, and Korea are allocating more financing for clean energy.

"Along with PLN's plan to increase the portion of clean energy in the generating sector, it needs to be supported as a joint step for the global energy revolution," Elrika said in a written statement, Friday, November 4.

According to Elrika, there are four (4) things that PLN can do to accelerate the energy transition agenda, one of which is a policy framework that is well designed and full of incentives that make it easier for investors to enter Indonesia.

"Second, maximizing the potential of natural resources that Indonesia currently has as an energy base. This has been done by PLN by mapping the potential of natural resources in supporting efficient energy security," said Elrika.

"Third, the Indonesian government's action in launching Energy Transition Mechanism (ETM) is a progressive step that needs to be supported to facilitate profitable and facilitating investment schemes," he added.

Finally, PLN must be able to align and build investor or lenders confidence in providing cheap and low-interest green financing.

"Of course this needs to be supported by transparency and accountability in financing management," added Elrika.

He assessed that the steps taken by PLN in packaging project plans were able to increase investor confidence in investing in the EBT generating sector. PLN also needs to create technology so that development still prioritizes efficiency and also the reliability of electricity supply.

"Collaboration is indeed an important thing in realizing this energy transition agenda," he added.

Meanwhile, PLN President Director Darmawan Prasodjo said that his party had carried out a number of initiatives to support the decarbonization agenda, one of which was to retire steam power plants (PLTU) and aggressively build new renewable energy plants (EBT).

In carrying out the project of pursuing the net zero emission target, PLN welcomes international support from the financing side.

"We plan to fully use this financing to support the construction of EBT-based programs," he concluded.